According to a release from the company, Hooker Furniture has terminated its Employee Stock
\n\t\t
\nOwnership Plan effective January 26, 2014. The termination will cost the company $18.4 million, but is expected to save the Hooker over $3.4 million a year.<\/p>\n
\u00e2\u20ac\u0153Our decision to discontinue the ESOP was primarily based on the fundamental change in our Company\u00e2\u20ac\u2122s business model over the last few years,\u00e2\u20ac\u009d said Paul B. Toms Jr., chairman, chief executive officer and president. \u00e2\u20ac\u0153In light of our changing business model, terminating the ESOP is in the mutual best interests of the Company, its shareholders and its employees,\u00e2\u20ac\u009d he said.<\/p>\n
In 2000, the ESOP became the largest single shareholder of the Company when it purchased, using a loan from the Company, 3.6 million shares (split adjusted) of Company common stock in a public tender offer. \u00e2\u20ac\u0153Since then, the Company has evolved from being a domestic wood furniture manufacturer to a home furnishings marketing and logistics company with world-wide sourcing capabilities,\u00e2\u20ac\u009d Toms said. \u00e2\u20ac\u0153During this period, the Company\u00e2\u20ac\u2122s workforce has declined from over 2,000 to approximately 1,000. In addition, we announced on January 17th that we plan to close our last wood furniture manufacturing facility, located in Martinsville, Va., which we expect will result in a further reduction of our workforce by approximately 280 employees,\u00e2\u20ac\u009d he continued.<\/p>\n
\u00e2\u20ac\u0153The increase in the Company\u00e2\u20ac\u2122s stock price since the tender offer has caused the annual expense of the ESOP to increase. This increase, coupled with the decline in the number of employees during the same period, has increased the Company\u00e2\u20ac\u2122s retirement benefit costs as a percentage of payroll expense to a point we believe is significantly higher than industry average,\u00e2\u20ac\u009d he said. \u00e2\u20ac\u0153This move will significantly reduce our benefits expense going forward and position Hooker to be more competitive in our marketplace,\u00e2\u20ac\u009d Toms said.<\/p>\n
As a result of the ESOP termination, previously unallocated shares of Company common stock held by the ESOP will be allocated to eligible participants, including those employed at the Martinsville plant scheduled to close in late March. Under the terms of the ESOP, a participant\u00e2\u20ac\u2122s ESOP account balance will be rolled over to the Company\u00e2\u20ac\u2122s 401(k) plan, unless the participant otherwise elects to have all or part of the account balance distributed to him or her or rolled over to an individual retirement account or another employer\u00e2\u20ac\u2122s retirement plan.<\/p>\n","protected":false},"excerpt":{"rendered":"
According to a release from the company, Hooker Furniture has terminated its Employee Stock<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":["post-3193","post","type-post","status-publish","format-standard","hentry","category-furniture-world-news"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/posts\/3193","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/comments?post=3193"}],"version-history":[{"count":0,"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/posts\/3193\/revisions"}],"wp:attachment":[{"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/media?parent=3193"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/categories?post=3193"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/tags?post=3193"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}